GOVT MULLING TO RAISE STAKE IN PGN

Jakarta, Apr 27 (ANTARA) - The government is considering to raise again its stake in publicly-listed state gas company PT Perusahaan Gas Negara (PGN) by converting the company's remaining debts to the government into shares.

"Some time ago 3 percent of the debts was converted into shares. We will soon do the same again. It is now a matter of administrative process," State Enterprises Minister Sofyan Djalil said here on Monday.

He said the company would use proceeeds from the conversion of debts into shares to finance its projects.

"Hopefully, it (the conversion) could materialize because PGN now has a number of projects," he said.

The conversion of 3 percent of debts into shares has lowered the company's debts to the government to Rp27.73 billion. Consequently, the government's stake in the company increases to 56.46 percent, while the remaining 43.54 percent is held by the public.

In addition, the company's fully paid-in and paid-up capital also increases by Rp99.27 billion to Rp2.39 trillion from Rp2.29 trillion previously.

But the minister stopped short of revealing by how much the company's debts to the government would be converted into shares.

"We have no problem... It is now for the general meeting of the company's shareholders to decide the matter," he said.

This year PGN has set aside US$200 million in funds as capital expenditures compared to US$150 million last year.

Nearly US$100 million of the 2009 capital expenditures will be spent on the construction of distribution pipelines.

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